Crisis Management in Managing Hotels in Labuan Bajo During

The Covid-19 Pandemic

Reynaldo Angga Siagian1, Gregorius A. Berybe2, Thyophoida W.S. Panjaitan3
1,2
Politeknik eLBajo Commodus, Indonesia
3
Universitas Katolik Darma Cendika, Indonesia
thyophoidapanjaitan@gmail.com

Abstract Keywords
covid 19; crisis management;
The Covid-19 pandemic at the beginning of 2020 had a significant
impact on all types of businesses which resulted in a crisis in all strategy
types of businesses in Labuan Bajo, one of which was the hotel
industry in Labuan Bajo. The Covid-19 pandemic resulted in the
room occupancy rate experiencing a drastic decline, one of which
was due to the lack of domestic and foreign tourist visits. This
situation requires the hotel industry to revise, innovate, and
change its business strategy. This study aims to explore crisis and
disaster management for tourism, especially in the hospitality
industry by considering a strategic approach from the hotel
management perspective. The government and local stakeholders
in an effort to grow the hotel industry in Labuan Bajo. One of the
strategies carried out by the government in an effort to grow the
room occupancy rate is by establishing certification in the hotel
industry that establishes health protocols based on Cleanliness
(Cleanliness), Health (Health), Safety (Security), and Environment
Sustainability (Environmental Sustainability) or CHSE. If it is
known that each hotel has implemented and made improvements
in terms of service to consumers based on the CHSE, the
government will provide subsidies or funds intended for the
purchase of tools related to handling COVID 19 in the hotel area.
In addition, giving a CHSE Certificate to a hotel will create a
feeling of security for consumers to stay at the hotel. The hotel
also needs to identify what consumers need and want, as well as
consumer behavior patterns, especially during the Covid 19
pandemic which pays attention to cleanliness, health, and
sustainability, so hotel management in offering and carrying out
hotel operational activities pays attention to the healthy lifestyle of
consumers.

I. Introduction

The existence of the COVID-19 pandemic has resulted in a crisis in all businesses,
therefore companies must prepare methods and strategies that must be carried out so that the
existing crisis cannot become a barrier for companies in carrying out their business activities,
which is often called crisis management. The COVID-19 pandemic has had an impact on
many aspects, one of which has an impact on the transportation business sector due to the
policy of limiting the use of transportation services which will have an impact on economic
activities on a national and global scale and have an impact on the tourism industry
(McKibbin and Fernando, 2020). The Covid-19 pandemic caused everyone to behave beyond
normal limits as usual (Sihombing, 2020). The fear felt by the public about the deadly Covid
19 virus has put pressure on the government and the business world, and will have a long-
term impact.

______________________________________________________________
DOI: https://doi.org/10.33258/birci.v4i3.2190 4163
 Budapest International Research and Critics Institute-Journal (BIRCI-Journal)
Volume 4, No 3, August 2021, Page: 4163-4172
e-ISSN: 2615-3076(Online), p-ISSN: 2615-1715(Print)
www.bircu-journal.com/index.php/birci
email: birci.journal@gmail.com

The COVID-19 pandemic has had a major impact on the hotel sector where the hotel
industry has suffered greater losses than the previous crisis. Where the average income per
room (RevPAR) decreased by almost 90% in the second quarter of 2020 and it is estimated
that this condition will continue to decline, due to the enactment of travel bans and the feeling
of fear of tourists being stranded (Courtney, 2020). Therefore, there is an urgent need for the
availability of practical guidelines that will help the hotel industry become more resilient
during the pandemic.
Research conducted by Chen (2011) stated that when the SARS (Severe Acute
Respiratory Syndrome) epidemic occurred in 2003, it resulted in a decrease in hotel room
income, where the decrease was more than six times compared to the 1999 earthquake and a
decrease of more than five times. times compared to the 2001 US terrorist attack. The results
of this study are in line with those of Chen (2007) and Chen et al. (2005) who stated that
during the SARS pandemic, it not only had an impact on decreasing hotel revenues but also
had an impact on increasing the discount rate on the performance of the hotel industry stocks.
There is still little research that discusses the impact of a disaster or pandemic on the
tourism industry, as well as relevant responses from the government in overcoming the
impact of this situation. This research can be an important platform to help the tourism
industry and government agencies to learn from past experiences, and develop strategies to
avoid similar things happening again (Faulkner, 2001).
Labuan Bajo, which is located in East Nusa Tenggara (NTT) is an archipelagic tourist
area and has become one of the most popular new tourist destinations in Indonesia besides
Bali, where Labuan Bajo is famous for its natural beauty, diverse beaches and seas, and
Komodo dragons. became one of those who felt the negative impact of the Corona virus
pandemic in 2020. The tourism sector is the largest economic sector for the government and
the people of Labuan Bajo, with the pandemic causing the number of domestic and foreign
tourist visits to decrease, one of which is the implementation of a lockdown in the country
other. The decrease in the number of tourist arrivals resulted in a significant reduction in
income, while expenses for accommodation costs continued and the staff needed to be paid,
making business owners experience difficulties in supporting their businesses.
During the Covid 19 Pandemic, restaurants and hotels businesses to keep running had
to reduce certain activities, reduce employees and productivity, which ultimately greatly
affected the profitability of the travel and recreation industry (Lee and Chen, 2020). For
decades research related to negative shocks to tourism has hardly attempted to link the impact
of health factors with tourism. The existence of Covid 19 can be a start to see how
management in the tourism sector is trying to deal with crises that occur due to disease. The
evolution of the spread of disease and its impact on the economic sector, especially tourism is
still not known with certainty, this makes it difficult for policy makers to formulate policies
to overcome them (Warwick and Fernando 2020).

II. Review of Literatures

To better understand the negative impact on the tourism sector caused by COVID 19,
an in-depth study of tourism actors and policy makers is needed to understand the direct
impact of COVID 19 and how crisis management must be carried out by stakeholders or
organizational managers to be able to fix it. This study aims to explore crisis and disaster
management for tourism, especially in the hotel industry by considering a strategic approach
from the side of hotel management and local stakeholders in order to maintain the active

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focus of the hotel industry in the Labuan Bajo area. What strategies need to be taken to be
able to lift their hotel again after this pandemic period ends in the Labuan Bajo area.
This study utilizes information obtained from news media sources, strategic responses
from hotels, is analyzed and then mapped through an integrated strategic crisis management
model (Ritchie, 2004; Ritchie, et al 2011).
According to Santana (in Alzoubi and Hisham, 2020), crisis management is a
continuous and holistic effort in an organization efficiently in an effort to understand and
prevent crises, as well as manage it with the interests of stakeholders in mind. According to
Fullchis (in Oktarini and Gayatri, 2020), crisis management requires the role of Public
Relations, where public relations plays a role in the process of formulating and implementing
strategies in an effort to deal with crises and publish existing information to the public or the
public, both internal public and external publics.
Faulker (2001) states that a crisis or disaster can be described as '. The direct challenge
is a test to measure the organization's ability to overcome it'. In responding to a crisis, an
urgent decision must be made by management to be able to rehabilitate the existing situation.
Faulkner (2001) points out the key elements of a crisis situation such as 'a). the existence of a
triggering Event, the impact of which is so significant that it disrupts the existing routine
operating structure and continuity of the organization; b). The threat level is high where the
decision time is short, and there is an element of surprise and urgency.
According to Parsons (1996) there are three types of crises, namely:
1. Immediate crisis, where there is almost no warning when the crisis comes therefore the
organization cannot research the problem or prepare pre-crisis plans.
2. Crises that arise, the development of the crisis is slow, and the impact can be stopped or
limited by the actions of the organization.
3. Continuous crises, crises that last for weeks, months, even years.
Crisis management can also be defined as: “a continuous and comprehensive integrated
effort by an organization to effectively understand and prevent a crisis, and to manage it
effectively when a crisis occurs by considering every step of planning and training activities
during a crisis” (Santana, 2003). 2004) In responding to a crisis, usually, management is urged to
make decisions that are not part of normal operating procedures (Anderson, 2006). Designing
and implementing policies related to good and strategic crisis management is a complex
matter, due to the fragmented nature of the tourism sector, and the socio-political context at
the crisis site which differs in characteristics and duration in each crisis. (Novelli et. al, 2018).
There are several strategies in dealing with the crisis in tourism. Mair et al. (2014) the
main strategies used in post-crisis marketing include improving the perception of an ongoing
disaster. For long-term recovery, involvement and control in the media and marketing is
carried out to improve the image of the tourist spot (Avraham, 2016; Armstrong, 2008). The
government is an important part in implementing a number of strategies to deal with the crisis
where the main focus is safety and security as well as providing financial assistance to the
tourism industry, especially to help business sectors affected by the crisis, developing new
tourism products, as well as marketing and promotion after the crisis (Gurtner , 2016; Tse et
al., 2006). Finally, effective crisis management means that senior management must manage
the impact of the crisis on various parts of the organization, such as information systems,
operations and human resources (Hickman & Crandall, 1997; Anderson, 2006) Several
concepts related to the crisis in tourism with several categories and with different types of crises.
Mckercher (1999) states that the crisis model will provide guidelines for the
management of a crisis that has occurred, but fails to respond specifically to a health crisis.
There are several conceptual frameworks in management theory developed for the tourism
sector in times of crisis. This study uses the methodology created by Ritchie (2004) which is

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compared to the model created by Faulkner (2001) Ritchie's model combines the cycle of a
crisis and the framework of strategic management to deal with a crisis (Novelli et al., 2018).
The world health agency (WHO) has also announced that the corona virus, also called
COVID-19, is a global threat worldwide (Ningrum, 2020).
Ritchie's (2004) conceptual framework has three stages: (1) Pre-crisis planning, (2)
crisis response and recovery, and (3) future resolution and learning (Novelli et al., 2018). The
important thing related to planning during a disaster is the need for flexibility on the part of
the workforce to be able to avoid uncertainty when a disaster occurs (Pollert, 1988).

III. Research Methods

This research is a qualitative method, in which data collection focuses on the hotel
industry. Field data collection using Rapid Situation Analysis (RSA) and literature studies.
The use of this approach in depth is better able to understand a crisis that occurs in the hotel
industry and can also see opportunities or opportunities for recovery in times of crisis. RSA
interprets the opinions and opinions of local participants in which the results of the analysis
can be used as reflection and transformation after the crisis.
Collecting data using a Rapid Situation Analysis approach supported by several
methods of observation, participation, depth interviews with stakeholder groups, and
informal conversations. This research consists of four stages, namely:
1. Literature research (eg government statements, journals and mass media)
2. Field observations in the public and private sectors
3. Semi-structured interviews in the public and private sectors
4. Results of formal and informal discussions
The informants in this study were: (1) managers from the hotel business unit, (2) the
government and representatives from NGOs in the Labuan Bajo area to strengthen the
analysis from a policy perspective.
As well as conducting research on several different affected sectors as well as policy-
making sectors that manage to get out of the crisis and it is hoped that understanding
regarding management behavior from the tourism side in responding to the COVID-19
pandemic phenomenon can be explained.

Table 1. Understanding Regarding Management Behavior from Tourism Side in Responding

to the Covid 19 Pandemic Phenomenon
Participant Type Code Number of Interviewees
Government Representative Pem1-Pem3 3
NGO GO1, GO2 2
Hotel LSA1-LSA5 5
Total 10

Data analysis begins with analysis of various data collected in the field. Data is
collected from the results of the interview activities will last for 20 to 40 minutes, using audio
and so on. The recording of the interview will be transferred in the form of a transcript. will
be transcribed. Next, an interpretation of the answers from the informants will be carried out
and finally an analysis will be carried out. In an effort to maintain anonymity, participants
will be given a code to represent their profession or work area.

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 IV. Discussion

Crisis management requires effective leadership, can communicate with stakeholders

and external parties, can make decisions, the ability to convince the public, active advocacy,
delegation and coordination of resources and provide effective responses, and engage in
stimulating good partnerships with stakeholders (Alzoubi and Hisham, 2020).

4.1 Crisis planning in Tourism Accommodation

Prideaux et al (2003), said that a disaster can be described as a disaster whose existence
cannot be predicted but can only be done by conveying information and contingency plans
that are carried out in the form of regulations or through reactive responses. The rapid growth
of tourism in Labuan Bajo while the rules that serve as a reference for tourism areas are still
few or not yet perfected in an effort to maintain safe and good tourism. The Labuan Bajo City
Government stated that regulations related to dangerous diseases were not yet available, and
that there were more regulations on natural disasters such as landslides and earthquakes.
Hotel management (LSA1) stated that the COVID-19 Pandemic caused hotel revenues
in Labuan Bajo to experience a significant decline, this was because the Labuan Bajo tourism
market focused on foreign tourists, so there was nothing the hotel could do because of the
lockdown. /restrictions on countries in the world. Five-star hotels have managers who can
understand things related to actions that must be taken in responding to emergencies when a
disaster occurs. When disasters occur, such as earthquakes and pandemics that occur
unexpectedly or occur suddenly, the hotel focuses more on cost efficiency because a disaster
will be followed by a decrease in visitors (LSA5). In addition, MSMEs or small-scale tour
and travel businesses during the COVID-19 pandemic did not yet have a clear disaster
management strategy.

4.2 Strategy for Coping with COVID 19

a. Human Resources Strategy
The hotel management in dealing with the COVID-19 pandemic needs to make
improvements in terms of cost efficiency in the hotel. One of the hotel's biggest expenses is
staff salaries. During the COVID-19 pandemic, there was a decline in room occupancy rates
in the hotel industry and the hotel industry in Labuan Bajo was no exception. Due to the non-
fulfillment of the guest quota every month, it encourages the HRD Manager to take a decision
to reduce the burden due to paying staff salaries. Research conducted at hotels in Labuan
Bajo stated that in relation to the presence of staff, the policy was not to dismiss large-scale
dismissals but to rotate during the working week or one month of work. Where based on
interviews with hotel management it is said that employee arrangements are in an effort to
reduce costs through shift arrangements, where half of the existing employees work for 2
weeks, while the other half of employees will be laid off for 2 weeks and vice versa.
The policy of most hotels in Labuan Bajo is to keep their staff even with almost non-
existent guest quotas due to maintaining room by room and also rooms to be cleaned whether
or not there are guests And again some hotels have the belief that the situation will change
where COVID 19 will be successfully tamed and tourism will bounce back where at times
when things are back to normal the hotel or accommodation will be able to call the staff.
Hotel management stated that the hotel still maintains the telephone contact of each of the
staff who were laid off and several times invited them to join events that we held at the hotel.
Because later the pandemic is over, it's a bit difficult to find good staff and good experience
(LSA 2).
In addition, it is very important to have good and continuous communication between
hotel managers and staff to maintain friendship. The purpose of hotel management is to retain

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existing staff in an effort to maintain the quality of service provided by the hotel compared to
recruiting new staff whose quality is unknown. Besides, on the other hand, with the
stipulation of policies to maintain existing staff and the implementation of shifts, it will have
an impact or risk on staff who are still working the possibility of being exposed to COVID-
19, the absence of health insurance, an increase in workload as a result of the reduction in the
number of staff with a higher workload remain the same, as well as additional extra work to
ensure the implementation of health protocols in all hotel areas during the pandemic
(Rosemberg, 2020).

b. Service Management Strategy within the Hotel

During the COVID-19 pandemic, every hotel in carrying out hotel operational activities
carries out Standard Operating Procedures. Based on the results of research on hotels in
Labuan Bajo, it can be said that on average they already have handling related to covid 19.
Today the discussion places more emphasis on what things the hotel should do so that it can
provide services that are safe from the COVID-19 virus and how to do it. anticipating that
consumers infected with the virus cannot enter/stay at the hotel.
In an effort to anticipate this, every hotel staff is given training related to SOPs that
apply during COVID 19. Every staff who has direct contact with consumers in providing
services will be given training on how to provide the right service without offending
consumers and still satisfying consumers . In addition, it is attempted when providing
services not close to customers (LSA 3). In addition, the hotel management stipulates that
when guests check in at the hotel, a safe distance between consumers has been enforced or
marked so that a safe distance will be created between one another (LSA 2). Therefore, every
employee/staff must understand the SOP rules that apply during the pandemic so it is hoped
that when visitors come, each staff can explain to consumers about the procedures that exist
at the hotel, namely what can and cannot be done while in the hotel. at the hotel. This all aims
to convince consumers that they will be protected while in the hotel so that it will foster a
sense of confidence in consumers (Valle, 2020).
More preventive measures to stop the covid 19 virus that can circulate due to defaults
that come from staff or guests, managers make rules that focus on cleanliness and health
measures, including cleaning rooms with alcohol, spraying alcohol in hallways, disinfectants
placed in every room, routinely cleaning tables and chairs after they are used by guests. In
addition, it also closes public facilities that have the potential to be used repeatedly by guests.
There are also hotels that partially cover the hotel living room sofas to avoid viruses that
could potentially be carried by outside guests (LSA 4).
To maintain the impression and message from the hotel to consumers that the hotel has
implemented hygiene and health standards in accordance with the SOP during COVID 19 in
several places, writings related to the cleanliness procedures of the COVID 19 era have been
posted. Starting from entering the hotel, placing an order at the front office, use public
facilities in and outside the hotel (such as guest seating/sofa, use of the bathroom, service to
guests in the waiting room and restaurant, and others).

c. Cost Strategy
Hotel management requires a large amount of money on a daily basis. Under normal
conditions, cost efficiency can be met due to an increase in tourists/tourists who come,
especially during high season. During the COVID-19 pandemic, there was a decrease in the
room occupancy rate while the costs incurred were relatively not reduced, ranging from
electricity costs, room cleaning costs, laundry, restaurant costs, garden cleaning costs,
logistics and staff salary payments. Not to mention counting the losses caused by guests

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canceling room reservations that have been booked previously and have become a separate
calculation for every accommodation, especially hotels.
Seeing the situation, the hotel management must implement a strategy in an effort to
reduce costs that are not too important, to streamline operations, and to monitor cash flow.
We cut operating costs, we close facilities that are not used, and minimize unnecessary use of
facilities (LSA 4). Many managers make policies by reducing their staff by half to reduce the
burden of paying salaries. Not only that, with a decrease in guests ranging from around 80-
90%, the staff that has been reduced has also been rotated.
In the logistics department, the hotel no longer provides or stores hotel and restaurant
needs for a long period of time. "Just buy enough. Especially food items even though we
have a refrigerator but because it hasn't been used for a long time because no one ordered it
makes the situation not fresh anymore. (LSA5). They prefer to buy goods according to their
needs for the next few days according to the number of guests and future orders.
Apart from the human resources side, hospitality must focus on the policies issued by
the relevant government agencies and seek financial assistance from the authorities. Currently
in terms of government policy, there is a policy that is devoted to tourism accommodation
around Labuan Bajo which "issues a policy of incentives and relaxation in the field of
taxation for taxpayers" (Gov3). this policy is quite helpful to lighten our burden for this year
(LSA1). On the other hand, the government issues health protocols based on Cleanliness,
Health, Safety, and Environment Sustainability or CHSE. If it is known that each hotel has
implemented and made improvements in terms of service to consumers based on the CHSE,
the government will provide subsidies or funds intended for the purchase of tools related to
handling COVID 19 in the hotel area. In addition, giving a CHSE Certificate to a hotel will
create a feeling of security for consumers to stay at the hotel.
They must also use efficient methods and systems to reduce operating costs, such as
strategically closing, partially closing, or reducing the number of properties and facilities,
delaying non-essential building and system maintenance, minimizing fixed costs, and cutting
non-essential services. Hotels should also engage customers online and develop sales
strategies such as upfront sales, package sales (combining airfare, accommodation, local
tours, and food and beverage), and flexible daily pricing strategies, based on the current
situation. Furthermore, as a community with a common goal, hotel brands must work closely
with their parent companies to overcome financial constraints. Many international and
domestic hotel chains have reduced management and franchise fees, waived marketing and
system fees, and offered discounts and pandemic prevention materials (Zhang et al., 2020).

d. Resolution and Evaluation

In an effort to restore the current situation, it is very important for the government and
the hotel industry in Labuan Bajo to have a strategy that will be carried out in an effort to
increase tourist visits which will have an impact on increasing room occupancy rates. Ritchie
(2004) states that resolutions and evaluations during the pandemic and after are very
important to do in order to see the direction of the existing strategies on the internal side of
the hotel, while on the external side it is seen from the policies set by the central and regional
governments. Therefore, the hotel industry needs to make changes, one of which is in the
services provided, such as innovating the products offered by paying attention to health
protocols, designing marketing strategies, distribution channels, and consumer consumption
patterns that are in accordance with conditions during the pandemic. Gallen, 2020). Where
the marketing strategy is carried out not only in terms of improving the products and services
provided to consumers but also needing to show health protocols at the hotel and always pay
attention to cleanliness that is always maintained so that consumers who decide to stay at the
hotel will feel safe from the COVID 19 virus while staying. .

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 In addition, the government (Pem 2) stated that other efforts that the government and
hotel industry could take in increasing tourist visits were by increasing the use of mass media
in promoting the existence of tourism objects and hotels in Labuan Bajo, where the display of
advertisements was more varied and emphasized more on hygiene. and cleanliness which is
part of the Health protocol during the pandemic and post-Covid 19 pandemic. Hotel
management must also maximize the use of existing facilities such as places to stay, provide
catering, and provide places for consumers to quarantine (Hao, Xiao, and Chon, 2020 ). In
addition, using digital media through OTA (Online travel Agency) and streaming channels to
display available products, a means to interact with consumers, and promote sales activities
(Xu, 2020).
Another impact of the COVID-19 pandemic is changes in consumer preferences and
changes in consumption behavior patterns of tourists. Therefore, the hotel must identify what
consumers need and want today, for example, customers pay more attention to cleanliness,
health, and sustainability during the post-COVID-19 era (Valle, 2020). In connection with the
behavior pattern of consumers, the hotel management in offering and carrying out hotel
operational activities emphasizes a healthy lifestyle, establishes and implements social
distancing in the hotel and reduces the occurrence of contact between existing guests.
The hotel can also maximize the use of digitalization in an effort to improve the
efficiency of the services provided and stabilize the quality of services, as well as carry out
payment activities using applications or mobile payments in order to reduce direct
interpersonal service contacts in an effort to reduce the risk of spread, and ultimately increase
consumer confidence in clean and hygienic hotel service environment. The hotel management
during the transition after COVID-19 also needs a digital marketing strategy in an effort to
reach potential consumers, especially millennial consumers and foreign consumers. In
addition, digital operational activities in hotel management are carried out to develop hotel
strategies that are safer and will be trusted by consumers.

V. Conclusion

The existence of the Covid-19 pandemic at the beginning of 2020 caused enormous
challenges in various business fields, one of which was in the hospitality industry. In dealing
with the existing crisis, the hotel industry in Labuan Bajo requires crisis management in
carrying out hotel management in order to capture the existing phenomena that cause losses.
Crisis management is needed in an effort to anticipate changes that occur in operational
management, human resources, and the biggest impact on hotel finances.
Therefore, management flexibility is needed in the event of a crisis. On the HR side,
there is flexibility of employees at the managerial level, especially during work time by doing
alternate rotations and roles in work that do not only focus on one job desk but can switch
functions to do other tasks, this is due to a reduction in the number of employees in an effort
to make savings in expenses and reduced number of room occupancy.
Hotel management in operational activities uses digitalization to improve service
efficiency and stabilize the quality of services provided to customers, and payment systems
with applications or m-banking to reduce direct contact between employees and customers to
reduce the risk of the spread of covid 19 and will increase customer confidence in the
environment. clean and hygienic hotel services. Therefore, the hotel must pay attention to the
hygiene and cleanliness of the hotel and follow the Health protocol in accordance with the
provisions set by the government. has become a rule and a habit that is carried out during
activities in the hotel.

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